How Much is Your Diamond Actually Worth (Beyond the Emotional Value)?
A diamond is typically one of the more expensive purchases a person will make in their lifetime. In this article I explore mainly the value of diamond itself. However, I talk enough about rings as well that you can pretty much interchange the word diamond with diamond ring (or other types of diamond jewelry).
Whether you are selling a diamond engagement ring to upgrade, downsizing, due to a divorce, or liquidating an estate, it is important that you get the most out of your sale.
Selling independently can be difficult and time-consuming. To maximize value for your diamond and spare yourself time and energy, we’ve put together this guide to let you know your options to get top dollar.
What do You Think Your Diamond is Worth?
Most people tend to overestimate the value of something that they hold on to for long periods of time. Perhaps they get emotionally attached to an object, which clouds their judgement when it comes time to sell.
I get it. I will be the first to admit that I’ve grossly overpaid for something because it was important to me.
- Underestimate – You may think that your diamond isn’t worth a lot, maybe a few hundred dollars or so. In reality, it could be worth thousands.
- Overestimate – You may overestimate the value of your jewelry because you are emotionally attached to it, or because a family member or friend sold one for that much. Thinking that your diamond is worth a lot because you paid $5,000 for it 5 years ago doesn’t make it so. More likely, it could be only worth half of what you paid or less.
An emotional attachment can develop due to the history of the object, along with factors like time, usage, and more. Therefore, it is important to know the true value of an object in order to avoid overpaying for something that you may not even find valuable anymore.
So, let me ask you, “How much do you think you’re diamond is worth?”
How Much Your Diamond is Actually Worth
“It’s worth its weight in gold!”
At least that’s what the advertisements say.
Diamonds are not as valuable as gold. Diamond prices vary from day to day, just like the price of any other commodity.
Unfortunately, diamonds are not rare. “Conflict diamonds” (blood diamonds) aside, the supply of mined diamonds greatly exceeds demand for them which makes them less valuable. That’s why you haven’t heard that saying about gold!
Reality Alert: Buying a diamond ring for $4,000 retail at a jewelry store does not mean that it is actually worth $4,000.
A Typical Diamond Ring Transaction
The price we typically put on a diamond engagement ring is anywhere from $4000-$6000. This is what most jewelers sell for and also the estimation consumers are using when they buy their own diamonds.
When you go to sell that same ring years later, you might be surprised to find out that its value is not anywhere near what it used to be.
Unlike most consumer products that are sold for retail price, diamonds (especially engagement rings) are not usually marked up 200-300%. Most jewelry stores will mark up wholesale prices by 50% or more.
We looked at 3 popular online diamond sellers at the time of publication to compare prices of a specific diamond stone. We found that you should be paying $2,250 for a round diamond with the following specs:
- 0.70 carat
- VS1 clarity
- G color
- Very Good cut
- Earth created (i.e., NOT lab grown)
- GIA report
Note: the costs above are just for the diamond. There would be the additional cost of setting it within a gold band (for example) which would push the price into that typical range we mentioned of around $4,000.
Blue Nile is one of the pioneers of selling diamonds and engagement rings online. You can see a screenshot of their diamond ring search feature below. The cheapest diamond that meets our above criteria is $2,240.
James Allen also has a diamond ring search feature. You can see a screenshot of their diamond ring search feature below that shows the cheapest diamond that meets our above criteria is $2,130.
Finally, we chose the popular BrilliantEarth online jewelry seller. Their cheapest diamond that met our criteria came in at $2,580.
If you’re lucky enough to find the same diamond somewhere else for less than $2130, you’d be getting a good deal in our opinion.
Many jewelry stores will mark up prices by more than 100% because they know that the majority of people do not know how to assess diamond quality. That means when you go to sell your ring, theoretically, it is worth 50% of the price you paid at the jewelry store.
This is why it’s important to understand what you are buying when you go into a jewelry store or buy online.
Understanding a Diamond’s Value When You Sell It
Have the ring appraised by an independent 3rd party (not a jeweler). This way, you know exactly what your diamond is worth.
If selling is an option, be aware of the fact that many online buyers can be dishonest and will offer lowball offers.
We recommend the website Worthy.com to sell your diamond jewelry. They bring the expertise and a proven process to get you top dollar.
Click for a free estimate, check out Worthy.com
Regardless of whether or not you are selling a piece of diamond jewelry, understanding the value will help give you peace of mind.
How Diamond Prices Are Determined
In modern jewelry, diamonds are priced by carat weight rather than quality. This means each stone of equivalent size, cut, and clarity will have a different price depending on the shape, color, and carat weight.
It used to be the case that a round brilliant diamond with the same exact quality (say a 1.5 carat diamond), was worth less than a more exotic shap such as an Asscher. However, take a look online and you can compare different shapes with the exact same cut, clarity, color, and carats. Using the same search tool from BlueNile as above, you can clearly see that it is a mixed bag in terms of the value of a diamond’s shape when you go to buy one.
On the sell side,
The Math Behind a Diamond’s Price
We won’t get into the nitty gritty of diamond prices.
The Rapaport Diamond Report, founded in 1978 by Martin Rapaport, is the world’s first and most trusted diamond price information source. Every week, the publication informs consumers and dealers alike about the current price of diamonds.
Using these price lists, you may follow the history of diamond prices over the last several decades.
Diamond prices have fluctuated greatly since 1978, with some types increasing dramatically and others merely modestly. There are no common guidelines for diamond price changes because they vary depending on the weight, color, and clarity of the stone.
Suffice to say that pricing of diamonds per carat can get complicated. Here’s a good article that lists out a brief overview of diamond prices and what to expect.
Diamonds are valuable no matter what their age, even old family heirlooms hold a certain amount of worth.
Why Diamonds Can Still be a Good Investment
Diamonds are not as rare as you would think they are. If anything, they are one of the most common gemstones on Earth. People buy them because they are expensive, not rare.
I know you’re thinking, “So if diamonds aren’t rare… The only reason they still have value is that they are expensive!”
Unfortunately, this is not the case. Diamonds hold their value because of tradition and how well-known they are.
At any given moment there are thousands of diamonds across the world that people are trying to sell, take back, or pawn off. Even though there is a surplus of diamonds on the market, most people do not know this and perpetuate the thought that diamonds are rare. Diamonds can still be a good investment. Although they aren’t as valuable as you think they are, they still hold value!
Worthy.com brings expertise and a proven process to get you top dollar.
Click for a free estimate, check out Worthy.com
9 Tips to Discover the True Value of Your Diamond
Below, you will discover some of the secrets dealers don’t want you to know about how much your jewelry is worth.
1. The more unique the shape, the more it’s worth
When you get down to it, there are only about 20-30 types of cuts in modern jewelry (the Asscher cut, the emerald cut, cushion cut, etc.). Because they are so few and far between, diamonds with non-traditional shapes such as heart shapes and Asscher cut diamonds are worth more than the average round brilliant diamond.
2. The length of time you’ve owned it matters
If your piece is an heirloom, it’s worth exponentially more than sitting in a jewelry store window for a year, or even five years.
In this case, you may want to consider speaking with an antique appraiser to find out how much it’s worth.
3. The degree of rarity matters
Diamonds have been found in a number of places all over the world, but the majority are mined and exported from one continent – Africa. Therefore, African diamonds are rarer than South American or Australian ones for example, which increases their value.
4. The color, clarity, and cut are worth more than the carat weight
It may seem like common sense, but diamond buyers will always pay more for a high-quality piece than an equal weight of low-quality diamonds. This is why you should never sacrifice quality when buying jewelry.
5. You don’t have to pay the “retail” price
There is a wide range of top-quality diamonds available at all different prices. As long as you don’t make hasty purchases or click on links from unreliable sources, you can find plenty of high-quality stones in your budget.
In general, it’s risky to buy diamonds from online classified sites or even eBay. This is because you don’t always know how reputable the seller is and many times people will sell fake stones for a low price. If the price is too good to be true, it probably is.
6. The color matters more than the clarity
Diamonds are graded on a scale from D (colorless) to Z (light yellow). The difference between these colors is so minute that most untrained buyers won’t even be able to tell the difference. However, the degree of color matters more than its clarity in terms of value.
7. Diamonds with certification have more value
Not only does a diamond need to be evaluated for its cut, color, and clarity grades before being sold – it should also have an internationally recognized grading report.
Diamonds with GIA certificates are worth more than other certifications. GIA diamonds carry a “good assurance” of authenticity, and they’re also the only internationally recognized organization that grades diamonds for color and clarity. This means you can be confident that your diamond’s quality is accurately represented by the certificate.
8. You may not have gotten a good deal in the first place
When you first buy a piece of jewelry, it’s difficult to tell if you’re getting a fair deal or not. An easy way to tell is by how much other pieces with the same characteristics are selling for when their weight is known.
For example, if you bought a round brilliant diamond engagement ring that weighed 1 carat, and then discovered another 1-carat round brilliant diamond engagement ring in your local jewelry store selling for less than you paid, it becomes clearer that you didn’t get a fair deal.
9. Your jewelry might be worth more than you think
As your parents and grandparents pass away, their jewelry is often given to the next generation – which means if they owned anything of significant value, you probably have something extraordinary in your possession. Most people focus on the value of a diamond in terms of how much it can fetch at market price when they are selling, but there is another way to determine its worth.
And regardless of what anyone may tell you about the “value” of your ring, carat weight isn’t always an accurate way to determine how much it’s worth. The only real way to know for sure will come down to the factors mentioned above.
De Beers Group and Diamonds
This brings us to the well-known company called De Beers Group.
Did you know that De Beers, the world’s largest diamond company, is also the creator of some myths and controversies about diamonds?
The entire advertising campaign was a scheme dreamed up by one man: N.W.Ayer’s copywriter Frances Gerety in 1947. Her slogan “A Diamond is Forever” has become one of the most memorable in advertising history.
The “A Diamond is Forever” campaign gave men an excuse to buy diamonds for their significant others, and created a demand that had not been there before.
A diamond became something special when it was given as an engagement ring because it wasn’t just any rock… It was a diamond!
De Beers had an entire advertising campaign in the 1930s that convinced people to buy diamonds and buy them often. Some of the ads would say things like “Why Marry?” to encourage couples to buy diamonds.
The main message of the campaign was simple: Don’t think about buying a car, a new wardrobe or another house. A diamond should be the first thing you buy because it’s an investment, and there is no better way to show your love for each other.
The Emotions Behind a Diamond
When it comes to selling jewelry, many people focus on the meaning behind the jewelry or how much they can get for it.
Your diamond could be worth the life of a sick pet, worth freedom of debt, or worth a financially stable future.
What am I talking about?
Your diamond that’s sitting in a box could be worth so much more than simply resale value.
Now, that’s not to say the amount you sell your diamond for isn’t an important detail, it is. But it’s time to look at what that amount can do for you and what that could mean for you.
Memories, Sweet Memories
Good or bad, memories are not tied to an object. You will still have those memories whether you have your diamond or not.
If you’re not wearing it anymore (perhaps you are divorced) and it’s just going to collect dust, you need to start making it work for you.
You wouldn’t let $2,000 dollars in cash just sit in a drawer, so why should your diamond be different?
Where to Begin
In order to get the most out of your diamond and in order to make the most impact on your life, you need to make sure you have the best in the business helping you.
That’s where our friends at Worthy.com come in.
Worthy is a selling partner you can trust to help you get the most for the diamond jewelry you’ve outgrown. You bring the jewelry, and they bring the expertise. Their expert gemologists will professionally clean and photograph your jewelry in HD, showing off every angle.
Then they have your diamonds professionally graded by the GIA to provide you with objective information that you can use to set your own reserve price for an auction in which Worthy puts your piece in front of 1000 vetted, professional buyers.
Once the offers start pouring in, it’s up to you to sell or have your jewelry returned (at no cost to you) if your reserve price is not met.
It’s that simple!
If this sounds like the right thing for you, get in touch with Worthy today and get the process started!
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